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This seminar exploits longitudinal claims data and a cost-sharing subsidy that has exempted copayment and coinsurance of healthcare service for children under the age of 3 in Taiwan. We conduct a regression discontinuity design by comparing the use of healthcare for children just before and just after their third birthdays. Our results show that lower level of cost sharing increases outpatient visits and discourages patients’ price-shopping behavior. In contrast, the utilization of inpatient care for children is price insensitive. Finally, we find little evidence on the impact of the cost-sharing subsidy on children’s short-run or long-run health.

Hsien-Ming Lien is currently a visiting Fellow at the Center for Advanced Study in the Behavioral Sciences (CASBS) and a Fulbright Scholar at Stanford University. He is also the Director of the Taiwan Study Center, and Professor in the Department of Public Finance, National Chen-Chi University and an adjunct Professor in the Department of Economics at National Taiwan University, where he teaches health systems, health economics, and econometrics. He earned his B.S. from National Taiwan University, and Ph. D. from Boston University.

Prof Lien’s research focuses on 1) physicians’ behavior; 2) the impact of the National Health Insurance program on the health care market; and 3) the impact of copayments on health care use. Prof Lien is a recipient of the Minister Wang Jin Naw Memorial Award for Best Paper in Health Care Management presented by the Kimma Chang Foundation in 2002, and the Golden Paper Award presented by the Chuang Yi-Chou Foundation in 2009. Prof. Lien has published papers in Health Services Research, Journal of Health Economics, Economic Inquiry, and other journals.